mortgage interest rates - WWYD?

[chiver78]

I got a sales email from Quicken Loans today, that was quoting a 5-yr ARM at 2.75% - which is half my current 30-yr fixed rate.

One of the things that continues to piss me off about my place is that I couldn't refi when the rates were in the 3's because it was a little bit underwater. now, there's no question that it isn't. I am about ready to pull my listing for the winter and re-list in a few months when the "days on market" timer will reset. after having spent 6 months on the market w/o a single offer, I don't expect it to sell the day it goes on market again, so I'll still be there a few months.

does it make sense for me to look into this? even without knowing what closing costs would be, that's a 50% cut in the interest rate. if it takes me another 6 months listed to sell the place, that means almost a year at the much lower interest rate.

thoughts?

[swamp]

Quicken sucks.

[Deleted]

Maybe there is a localer guy that could match it.    I would work up a break even calc and see if it makes sense. 

[kittensaver]

Read the fine print - carefully. Quicken has LOTS of conditions and exclusions. Many of their ads are come-ons, and almost no one "qualifies" for them. Sad but true.

[chiver78]

okay, so Quicken sucks. I'm on bankrate.com right now, and everything they show seems to be around the same numbers. take Quicken out of my OP, I won't go there

does this even make mathematical sense for me to consider, or am I wasting my time?

ETA: and Archie, that's where I need the help - the break even calcs, just a ballpark would be cool.

[Deleted]

Oct 3, 2013 14:41:08 GMT -5 swamp said:

Quicken sucks.

I was very happy with my quicken loan and my quicken no cost refi.

[Deleted]

Oct 3, 2013 14:45:57 GMT -5 chiver78 said:

okay, so Quicken sucks. I'm on bankrate.com right now, and everything they show seems to be around the same numbers. take Quicken out of my OP, I won't go there

does this even make mathematical sense for me to consider, or am I wasting my time?

ETA: and Archie, that's where I need the help - the break even calcs, just a ballpark would be cool.

what are your numbers?  current mortgage loan amounts and payments?  

[Peace Of Mind]

Oct 3, 2013 14:45:57 GMT -5 chiver78 said:

okay, so Quicken sucks. I'm on bankrate.com right now, and everything they show seems to be around the same numbers. take Quicken out of my OP, I won't go there

does this even make mathematical sense for me to consider, or am I wasting my time?

ETA: and Archie, that's where I need the help - the break even calcs, just a ballpark would be cool.

Aren't you trying to sell your place?  If you don't plan on staying there for at least a few years or more you won't even break even on the fees - most likely.  I don't have your numbers to run.  Are you resetting your mortgage term or are you starting over?  Bankrate.com has a calculator to figure out if it's worth it or not.  Let me see if I can find one for you.  brb.    

Here is one that looks user friendly from MSN Money:

money.msn.com/home-loans/refinance-calculator.aspx

[chiver78]

current remaining balance is $227k, payoff estimate shows just over $229k.

current payment is $1757
P&I is $1383
escrow is $374

interest rate is 5.5%

[Deleted]

Oct 3, 2013 14:59:06 GMT -5 chiver78 said:

current remaining balance is $227k, payoff estimate shows just over $229k.

current payment is $1757
P&I is $1383
escrow is $374

interest rate is 5.5%

Was your original loan closed around Aug 2009?

[chiver78]

May or June of 2009, I'd have to double check

[Deleted]

Oct 3, 2013 15:08:15 GMT -5 chiver78 said:

May or June of 2009, I'd have to double check

Close enough.  I just wanted to make sure my numbers made sense.

IMHO, if you are could get a refi  for cost of around $2k, you would break even after about 6 months.   That would mean 8 months from now if you closed in 60 days.

But you would be saving about $450 a month if you refied to a 2.75% 5/1 .ARM

[chiver78]

Oct 3, 2013 14:49:55 GMT -5 Peace Of Mind said:

Oct 3, 2013 14:45:57 GMT -5 chiver78 said:

okay, so Quicken sucks. I'm on bankrate.com right now, and everything they show seems to be around the same numbers. take Quicken out of my OP, I won't go there

does this even make mathematical sense for me to consider, or am I wasting my time?

ETA: and Archie, that's where I need the help - the break even calcs, just a ballpark would be cool.

Aren't you trying to sell your place?  If you don't plan on staying there for at least a few years or more you won't even break even on the fees - most likely.  I don't have your numbers to run.  Are you resetting your mortgage term or are you starting over?  Bankrate.com has a calculator to figure out if it's worth it or not.  Let me see if I can find one for you.  brb.    

Here is one that looks user friendly from MSN Money:

money.msn.com/home-loans/refinance-calculator.aspx

thanks, POM. I am going to sell, but I'm taking a breather for the winter to reset the "days on market" for my listing. I'm also going to be watching sale prices over the winter to see which direction they go. they have been ticking upward, so that's encouraging.

your link tells me that with the default closing costs, I'm looking at an 11-month payback time. ugh....I'd be halfway there if I had refi'd last winter.....but then with my luck, I'd have sold right away. that's kind of where I'm stuck - I want to make sure I'm paying the best interest rate I can get for the time I'm still there, but don't want to screw myself over with the final numbers. and if I don't end up getting offers quickly next time around, that's just going to be more time that I'm paying the higher rate and stewing over it.

[chiver78]

wow, that's not a very long time at all! thanks, archie. maybe this is worth looking into a bit further....

[tskeeter]

Chiver, you're planing to sell the place within a year.  Doing a refi might save you a few hundred dollars, but most refi's these days are a lot of work and hassle.  Unless you have nothing else to do with your time, I question if refinancing is worth the work for a few hundred dollars.

[cronewitch]

Beware of bankers quoting savings amounts. They want you to take a loan and often will calculate the lowered payment from the current payment as a savings. The only real savings is paying less interest. So going to a longer time will show as a savings even at the same or higher rate.

[Deleted]

Crone, it's a five-year loan, which is actually what would scare me the most.

Chiver, I know you want to sell your home, and I want that to happen for you.  But what if your home doesn't sell?  You are really predicting what interest rates will be five years from now.

If you have a "decent" rate and are actively trying to sell, I'd pass.

I tried working with Quicken Loans.  I didn't get an offer like yours, but their costs were high.  Thee was an origination fee and lots of other fees.  You have to pay for the credit report and appraisal whether you qualify for the loan or not.  They required a $500 upfront fee.  Once the guy matched me with HARP, he wasn't willing to look for any other program even though my house appraised for pretty much what I paid for it so I had more than 20% equity. 

I know you said "delete Quicken" from your original post, but I just want you to know that about them.  On the plus side, they had only spent about $350 of my $500 when I decided they weren't working out.  (I was really annoyed that I had to be pushed into HARP rather than looking at other loans with lower interest rates . . . the ones posted on the Internet like you are talking about.)  They did refund my other $150.  But they aren't willing to eat anything if you don't qualify. 

Some people on here have had great experiences.  I simply wasn't one of them. 

[chiver78]

thanks for all the feedback. sorry I disappeared for a few hours, I just got home from work a little while ago. let me start out by saying I'm not bent on refinancing, or not, or whatever. I just figured a rate that was half what I have now (5.5%) might be worth my time to just look into, to see if it would end up saving me $.

I put my information into Lending Tree just before I left work, and my phone's been ringing off the hook since about 5 minutes later. I spoke with one guy on my drive home, and was quite clear about what I'm hoping to accomplish (saving as much as possible overall), and that I will be re-listing my place in the spring. I also told him that I intend to give every company that responds to me a shot at putting good numbers on the table - everything, including closing costs and fees - so I can compare apples to apples. he sounded totally okay with all of that, and offered way more options than the base 30-yr fixed. game on.

I figure the hard pull on my credit isn't going to be awful, since I'm not doing anything else for awhile (including buying again immediately once I do sell) so what the hell? if none of the lenders can give me a package that makes sense, I won't refi. and I'm totally coming back here for a sanity check once I do have numbers. the guy tonight started telling me details and I could feel my eyes glaze over.

the companies that have responded so far:
Guaranteed Rate (the guy I talked to)
Discover Home Loans
Quicken (the same guy I talked to the last time I refi'd, I think....? I ended up ruling them out back then)
RoundPoint Mortgage
Loan Depot - I'm probably not calling these people back. the young woman that left the voicemail sounded completely uninterested in having anything to do with me. no thank you!

[Works4me]

If youare able to re-fi for a good price would staying where you are and not selling be a consideration?

[saveinla]

You should also call your current lender to see if they will work with you. I was able to work with Wells Fargo (although it was a nightmare) to shave off 2% on the interest rate even though we were upside down on our mortgage at that time. Good luck. 

[chiver78]

given Mr Congeniality's attitude adjustment since I listed, I would consider it if the price was right. honestly though, I don't need to be spending $2100 a month on my housing* (between mtg and condo fee) so that number has to come down a lot for me not to re-list as soon as possible.

*in the time since I bought this place, I've come to realize that my mom doesn't know everything about finances. I stretched to buy this place under her guidance that it would appreciate as the market had been, and that I couldn't possibly lose $ along the way.  knowing what I do now - I had NO business buying this place when I did. that I haven't lost it over the years is something I'm kind of proud of now. I wouldn't ever consider buying something at the same price, even with the depressed (in comparison) market, and I have 7 years of raises to add to the income I had back then!

[chiver78]

Oct 3, 2013 19:53:28 GMT -5 saveinla said:

You should also call your current lender to see if they will work with you. I was able to work with Wells Fargo (although it was a nightmare) to shave off 2% on the interest rate even though we were upside down on our mortgage at that time. Good luck. 

interesting.....I will definitely make that call tomorrow, thank you! what key words worked for you? should I be asking about HARP loans (I don't think I qualify - my current loan closed 6/25/09, I checked after Archie asked) or some other refi options? were there closing costs associated with your modification?

looking quickly at what the Discover guy sent out tonight, they are offering a $2k credit of some sort (waiting on details, I specifically asked about that) toward closing costs because I've been a customer for 10 years - 2 CCs. there is also an email from the Guaranteed Rate guy, that I'm not even opening until tomorrow. I'm watching hockey and checking in here in between periods, not the best environment to digest numbers!

[Deleted]

Are you seeing any loans with no points/origination at the 2% rate?  I'd jump on those because the other fees are usually pretty low (appraisal, credit check, prepay escrow-again).  If you can lower interest rate without the fees, I would do it.

Do you have a credit union? Mine is showing 2.65% for 5/1 LIBOR and 3.0% for 7/1 LIBOR or 4.1% 30 yr fixed so their rates are pretty good.

[saveinla]

Oct 3, 2013 20:01:18 GMT -5 chiver78 said:

Oct 3, 2013 19:53:28 GMT -5 saveinla said:

You should also call your current lender to see if they will work with you. I was able to work with Wells Fargo (although it was a nightmare) to shave off 2% on the interest rate even though we were upside down on our mortgage at that time. Good luck. 

interesting.....I will definitely make that call tomorrow, thank you! what key words worked for you? should I be asking about HARP loans (I don't think I qualify - my current loan closed 6/25/09, I checked after Archie asked) or some other refi options? were there closing costs associated with your modification?

looking quickly at what the Discover guy sent out tonight, they are offering a $2k credit of some sort (waiting on details, I specifically asked about that) toward closing costs because I've been a customer for 10 years - 2 CCs. there is also an email from the Guaranteed Rate guy, that I'm not even opening until tomorrow. I'm watching hockey and checking in here in between periods, not the best environment to digest numbers!

I did not mention anything - I asked if they could work with me (to just lower my interest and term - I wanted to keep the same payment but went from a 30 year to 20 year loan and shave off 7 years on the mortgage) and they said yes. I was almost bowled over because I had called BOA and they said no right away.

They charged us almost 1700 for everything, but I did not have to pay the mortgage for a month after I closed, so it worked out well. But it took more than 3 months and I had to fight with them at the end to get it done. It's been almost 2 years now and I just got a mail from the mortgage guy again, so I have been thinking of calling him again and checking out rates again.

[bean29]

Can you check with your current lender and see what kind of adj rate loan they might give you?

Sent from my MB855 using proboards

[chiver78]

I you guys. I've been asking some very pointed questions of these guys and catching them a little off guard. thank you!

ok, so the first 2 to come back have quoted around 3.5% for a 5/1. not quite half, but still a huge improvement over what I have now. I think when all the numbers come in, I'll plug 'em all into that calculator POM posted and see what I get.

when I leave work today, I plan to call my current lender as well as Quicken (who doesn't seem to want to do anything over email, like the others ) to see what they can do.

oh, and the hard pull on my credit report last night came back with a middle score of 771. that doesn't suck.

[Deleted]

chiver78,

Be sure to let your lender(s) know that the property has been listed for sale within the last  six months since the appraiser will find out anyway. IIRC, there may be a restriction. @reoflyte can let you know if there are FNMA, Freddie or FHA restrictions. I don't know the reasoning; whether the investor can't recover his/her costs or if they assume that you are going to rent it out. 

[chiver78]

@bonnap,

thanks, I have been very upfront with everyone I've spoken with regarding my soon-to-be-expiring active listing and the fact that it is currently an FHA loan. all but one have told me that the listing needs to be off-market for one day before I can initiate a refinance. Quicken surprised me with a policy of six months past active listing. none has given me any issues with the FHA status.

[Deleted]

Chiver,

I'm sure you are. It's just that sometimes there are issues that you don't even think will be a problem because you don't think in a devious way.

I'm not surprised at Quicken's response.

Good luck with the running of your numbers. And glad your neighbor is being less of an A-hole!

[chiver78]

Bonny, I totally hope my reply wasn't taken as flippantly as it might have come across! I'm not bent on any action one way or another, and am absolutely open to all feedback before I move forward with anything (I haven't AT ALL decided what Im doing yet....)